CLEVELAND-Grubb & Ellis Healthcare REIT II Inc. has picked up the three-story St. Vincent Medical Office Building here on the campus of St. Vincent Charity Medical Center. The 51,000-square-foot facility was purchased for $10.1 million from Vincent MBL Investors LP, a group unaffiliated with the hospital.

Stefan Oh with the trust tells GlobeSt.com that the property has two things going for it, such as the being directly on a strong medical campus. "Also, we’re setting up regional portfolios, we want to buy where we have existing properties," Oh says. The trust bought Parkway Medical Center in nearby Beachwood, OH in April, paying almost $11 million.

This building, at 2322 E. 22nd St., is 92% leased, with the hospital taking about 65% of the leasable area. The facility was built in 1984, and is connected to the St. Vincent hospital, which is a member of the Sisters of Charity Health System.

The trust is seeking to raise up to about $3 billion in equity and to acquire a diversified portfolio of real estate assets, focusing primarily on medical office buildings and other health care-related facilities. Oh says that the medical office market has been heating up in the first half of the year.

"We’re now starting to see more activity in the market from other groups, such as the Ventas deal to acquire Lillibridge earlier this month. Cap rates probably peaked for medical office sometime in summer 2009, and they have been creeping down a little. Occupancies have held up, and there’s been a lot of demand," Oh says.